Submitted in partial fulfillment of the requirements for the degree of Master of Social Sciences in the graduate program of the year. None of this work has been previously submitted for any degree or examination at any other university. Every public school must establish a finance committee consisting of the chairman of the governing body of the school, the principal, the treasurer and the financial officer.
The Department of Education is responsible for providing leadership and management support to school governing bodies and principals.
INTRODUCTION
Background to the research problem
According to the South African Schools Act No. 84 of 1996, school management and the principal must support each other in the running of a school. The governing body of the school performs the following duties as set out in the South African Schools Act;. The school's governing body must set up the finance committee to manage the day-to-day affairs of the school's finances.
The law mandates the finance committee to report monthly to the school board on financial matters.
Research Aims and Objectives
Schools can use state subsidies to purchase furniture, equipment, textbooks, stationery or to renovate the school buildings. In addition to school fees, public schools can generate income from donations, extra lessons, school functions, interest income, rental income, scholarships, etc. The common expenses at public schools are salaries and wages for support staff, water and electricity, text books and office supplies, equipment repairs, telephone, travel expenses, furniture, equipment, garden tools, school activities and training of teachers, training of administrative staff, sports, music and cultural activities.
Most (if not all) public schools have a serious problem with scarce financial resources and therefore not all schools can meet their needs.
Summary
The Department of Education lays down the rules on how the state subsidies can be used by the schools. It is important to mention that if someone donates money to the school on the condition that it must be used for a specific purpose (for example the purchase of a computer) such money can only be used for that purpose. In light of the above problems, it was decided to conduct this research on financial planning and.
2 LITERATURE REVIEW
Introduction
The Legacy of Apartheid
School financial management in the context of education reform
Fiske and Ladd argue that one of the most pressing problems in many poorer communities has been the lack of schools and classrooms. Chisholm argues that the scarcity of services in underdeveloped and rural areas has a direct impact on the socio-economic status of the community. This inevitably hinders the delivery of quality education as it is one of the priorities of the Ministry of Education.
It is very interesting that the Ministry allocates funds for such areas according to the needs and socio-economic status of the communities in the area.
Post – Apartheid Government Initiatives
Schools without Section 21 status must have their SGB and the head of school communicate decisions about how the allocations are to be used to the province. Non-Section 21 schools are still required to budget and are also responsible for any fee-generated revenue, but are not free to use state-allocated resources without working through the department. Notably, Section 21 schools (many of which were former Model C schools) generally do not receive much.
Therefore, schools with a larger share of fee revenue and lower state contributions tend to be Section 21 schools and have a greater degree of control over the management of available resources, while schools with much larger state allocations and lower fee revenue have reduced authority over the field of financial management.
Facilities and Infrastructure, Basic Services and Adult Education
Equitable Spending Versus Quality Education
The system's structure, curricula and certification have been revised and adapted to a new qualification system. Shortly after 1994, the South African government faced a challenge to improve both equity and quality within the framework of limited resources. The government's intention was to achieve both by redistributing teachers (the highest cost in the budget) from better resourced, white and mainly urban schools to poorer resourced, black and mainly rural schools and by shifting part of the burden of the cost onto parents through school fees. .
All schools are rated based on the physical conditions and poverty level of the community in which they are located.
The role of the School Governing Body in financial Management In terms of Section 43 of the South African schools’ Act;
The chair of the governing body or head of school usually drives the budgeting process. The board must first refer the budget to an ordinary general meeting for parents at the school. In practice, parents can approve the budget as prepared by the governing body or reject it for certain reasons.
If they reject it, the governing body must make the changes desired by the parents and then approve the budget.
Financial Planning and Management in Organisations
In the same way, systems of management accounting have certain flaws in terms of completeness, the timelines and the objectivity of the data that is produced. That is why it is important that all organizations have good systems of internal control and internal audit functions. It was widely agreed that the internal audit function is now a well-established practice and should be developed in parallel with the growth of computerized information systems.
The organization can also use internal auditing to identify problems that arise not only from the application of controls within an organization, but also from operations and performance of the organization itself.
Some theoretical frameworks
In addition to carrying out the internal audit, the school's financial records and statements must be audited by an external auditor. Furthermore, and perhaps more usefully, it would also be useful to understand within the school environment how different interest groups interact over financial allocation choices – internally within the school and between the school and the community and between the school and government. Actual choices made within schools may not only reflect alignment or failure to align with policy, but also show the existence of struggles over resources, for example between the influence of teacher unions and parents.
An awareness of the literature on new public management approaches, which reflects the increasing influence of corporate governance practices in the public sphere through processes such as corporatization of entities, partnerships between government and other stakeholders, adoption of reporting and accounting, would also be important in this discussion. techniques next to it. In this regard, the language of the South African Schools Act on financial matters reflects a significant shift towards encouraging schools to adopt corporate financial management. Finally, some exploration of the ideas of Max Weber and particularly his insights into bureaucracies and their functioning is useful.
Weber outlined that bureaucracies are not necessarily parasitic entities that reflect class interests, and furthermore that bureaucrats could be in a position to exercise power independently of class formations through their access to power. This is potentially useful in examining the relationships between provincial department financial bureaucrats, school principals, and parent representatives on a school board.
Summary
Introduction
Aims and Objectives of the Research
Sampling Technique
Furthermore, it enabled the assessment of issues of validity and reliability of the data to be collected. The first step in the pilot test of the questionnaire was to get my colleagues and friends who hold senior positions in finance and education to answer the questionnaires. I also encouraged them to give me suggestions regarding the restructuring of any questions they felt were misleading.
In addition, I asked them to list any additional questions that they believed including would inform the validity and likely reliability of the data that would be collected. The questions were structured around budgetary issues, credit control, cash management, inventory management, maintenance and control of fixed assets and accounting systems. The school financial statistics questionnaire aimed to find out the actual income and expenditure in the years 2004 and 2005.
In addition, school principals had to mention how they spend the school's income on various items.
Interviews
It was desirable to choose the semi-structured interview technique as it lies between structured and unstructured interview. As there was not enough time to interview a large number of heads of school governing bodies, it was decided to interview only ten heads.
Problems of reliability and validity of data collected
Long questions or those consisting of two or more questions were avoided. Questions were formulated in such a way that too many theoretical concepts or jargon were avoided. Finally, the problems affecting validity and reliability of data were discussed, and steps taken to overcome these problems were explained.
FINDINGS OF THE RESEARCH
- Introduction
- Overview of Income and Expenditure
- Calculation of school fees and state subsidies
- Findings Semi-Structured Interviews with Chairpersons of School Governing Bodies
- Broader reflections on the findings
- Summary
- Conclusion
- Recommendations
- Competent Persons in the Finance Committee
- Financial accounting system
- Petty cash
- Removing mistrust between chairpersons and school principals
- School management computer software
- Analysis and interpretation of financial statements
- Credit policy
- Cash management
- Stock management and control systems
- Fixed assets management
- Fundraising
- School tuck-shops
- Financial Planning and Management
- Concluding Remarks
This practice seems to be one of the ways to raise funds for the school. Tensions can arise if their duties are not clearly stated, especially with the day-to-day running of the school. Six chairmen (60%) out of ten said that they are sometimes under pressure to approve certain expenses (sign cheques) when they are not fully convinced of the benefits of the expenses for the school.
It appeared that they believe that the principal is responsible for doing the fundraising on behalf of the school. Six chairmen (60%) out of ten declared that they were fully satisfied with the details of the year-end financial report that the school principals gave to the parents in the meetings. Surprisingly, no member of the governing body wants to talk to these four principals about it.
Members of the governing body must be educated about their role or they cannot benefit the school. From these answers, it appears that most of the school leaders take the necessary considerations into account in their budgets. Of the twenty responses, 95% of school leaders acknowledged that the educators owed money to their schools.
Is there any amount of money belonging to the school that is owed by the educators or member of the governing body. Is there any educator or member of the governing body or any person who is owed by the school for the service he has rendered to the school. Is there any educator or member of the governing body who has granted a short-term loan to the school but has not yet been repaid.
Are you satisfied with the details of the financial report given by the principal at the end of the year? Is there any amount of money belonging to the school that is owed by the educators or member of the governing body. Is there any educator or member of the governing body or any person who is owed by the school for the services he has rendered to the school.
